Also in the early 1990s many of the 300,000 refugees from Nicaragua and El Salvador returned home. With political stability within these two regional neighbors there has been the elimination of a major source of violence in its border regions.

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From the mid-1980s to the mid-1990s, the most serious threat to civilian government came from the military. The United States' Central American policy boosted the prestige, status, and power of the Honduran military, which grew confident in its ability to forge the nation's destiny.

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With the end of the Contra-Sandinista armed struggle in Nicaragua, there was a dramatic decline in military assistance from the United States. This allowed President Reina to assert civilian control over the military establishment in the mid-90s.

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In 1998, just as the Honduran economy was beginning to recover from economic setbacks occasioned by turmoil in the influential Asian financial markets. Hurricane Mitch wreaked havoc on the nation's infrastructure. Roads, bridges, schools, clinics, and homes were destroyed, and thousands of lives were lost. Recovery from this natural disaster will be prolonged and costly.